PD Roundtable for Global Law Firms
The Professional Development Roundtable for Global Law Firms is now accepting new members. The next meeting of the Roundtable will be held on May 17-18, 2010, in Los Angeles, at the offices of Paul Hastings Janofsky & Walker.
The objectives of the Roundtable are to:
This Roundtable provides a forum where individuals in charge of professional development in global law firms can regularly share information, study and consider best practices, and explore the challenging issues that they face. Membership is limited to partners, directors, and officers in charge of lawyers' professional development at a strategic level in law firms with at least four international offices. If your firm qualifies for the Roundtable, this is an opportunity you do not want to miss. For further information and a membership application, please contact me.
Hastings Leadership Academy for Women
The 2010 Leadership Academy will take place July 11-15, 2010. This program is essential for women partners who want to advance their careers and for law firms that want to see more women partners in positions of leadership. This year’s program will consist of one intensive on-site session and three quarterly follow-up teleconferences. We will also have special programming that includes senior women in-house counsel and Leadership Academy alumnae. Information and registration forms are available at www.attorneyretention.org/LAW. In the meantime, save the date and contact me by email or phone, 510-339-6883, if you would like further information.
Three Trends to Watch
It’s early in a new decade and a good time to think about the changes that are sure to come in the months ahead. Many clients are asking me about what those changes will be, how they will affect the firm, and how to adjust to those changes. Here are my thoughts about three major trends that will improve the way lawyers work and practice – and what law firms will need to learn in order to make that happen.
1. Restoring trust in client relationships.
For a long time, law firm marketing efforts have touted their “client service” orientation, and many lawyers genuinely believe that their legal services are truly centered on the client. But their actions often belied their PR. While lawyers did their best to protect the client’s legal interests, many did so without regard to the client’s pocketbook. By trying to maximize revenues through ever-increasing hours and rates, lawyers were perceived as placing clients’ financial interests second to the firm’s. The tension between the client’s need for cost control and the lawyer’s need to maximize time and fees, led to a breakdown of trust. Lawyers had to be reminded that the adversaries were opposing counsel, not their own clients. Law firms got away with this behavior so long as demand for legal services was high and firms could drive hard bargains.
Now that the economy has forced clients to limit legal spending, the balance of power has shifted to clients, and it is they who are calling the shots. Clients are taking tougher bargaining positions and if met with resistance, are moving their business to more agreeable law firms. In order to earn and retain that business, law firms are being forced to change the way legal work is done and billed.
Some firms may feel pain when clients flex their muscles this way, but forward-thinking firms will recognize this as an opportunity to reinforce - or rebuild – trusting client relationships. They will prepare lawyers to understand more about clients’ business, to build and lead productive client teams, and to develop more collaborative, innovative and transparent work arrangements.
There have been many examples in the news recently of innovative business arrangements that are explicitly based on trusting relationships, enhanced communication and collaboration between lawyers and clients. In one prominent example, drug company Pfizer has reduced its legal team to 19 outside firms that form the “Pfizer Legal Alliance” and handle 75% of the company’s legal matters. Each firm receives an annual flat fee, paid in monthly installments, for all of the work that it does for the entire year. Negotiations to set each firm’s fees are focused on finding mutually agreeable terms based on the type and volume of work that the firm is expected to do during the year. Some firms have been paid more when they did more work than was expected. All firms are evaluated at the end of the year to determine whether the relationship should continue - and also whether bonuses are in order. Amy Schulman, Pfizer’s General Counsel, has stressed that the purpose of this approach is to have all her outside lawyers working as business partners with Pfizer and with each other. It is not simply to save money, which she could have achieved with discounted rates.
In order to work with clients and legal teams in this way, lawyers need first-rate “relationship” skills, including trust-building, communication (especially listening and engaging in purposeful conversations), empathy, teamwork, flexibility, handling difficult conversations, and conflict management. Law firm curricula should include these skills and traits, and give considerable attention to client relations in general.
2. An increasing emphasis on competencies.
The legal profession has not articulated a set of core competences that lawyers need in order to be effective practitioners. However, many firms have begun to develop and use their own core competencies in professional development, associate evaluations, and career tracking. As discussed in a previous issue of Management Solutions, as more firms go off lockstep, the use of competencies to assess performance will spread. The process of developing competencies that drive career and practice success of lawyers is arduous and implementation requires training, preparation and oversight. While some firms utilize competencies effectively, most firms and the legal profession as a whole are not yet sophisticated users. Nonetheless, over time, competencies will play an ever-increasing role in lawyers’ professional development and firm talent management systems.
This trend was highlighted in a recent conclave sponsored by ALI-ABA and ACLEA. Leaders from all areas of legal education and practice came together in October, 2009, to consider the best ways to equip today’s and future legal practitioners. The outcome of this “critical issues summit” was a series of recommendations for law schools, the bar, providers of CLE programs, law firms and other legal employers.
The underlying theme throughout the summit, which is reflected in the recommendations, was the central importance of “career long development of lawyer competencies” needed for practice. The report emphasizes the need for (1) a rigorous, evidence-based approach to the identification, selection, and application of competencies that actually correlate with successful law practice, and (2) development of educational techniques and approaches that teach lawyers those competencies.
Those engaged in lawyers’ professional development have many roles to play in the evolution and implementation of law practice competencies. One role is to ensure that the application of competencies in your firm goes beyond ticking off “done” on a checklist of activities. After all, experience alone does not impart professional competence, judgment or wisdom; it must be accompanied by reflection, insight and guidance. Another role is to ensure that all partners in your firm have the supervisory and mentoring skills they need to employ competencies to foster learning and development among associates. Still another is to test outcomes, evaluate effectiveness, and report on your experience with competencies, so that the profession can learn what best practice competencies are and the best ways to teach them to lawyers.
3. A greater focus on project management.
As clients continue to demand deeper discounts, flat or fixed fees, and other changes in traditional fee arrangements, law firms will incur greater case- and deal-related risks, including cost-overruns. In order to retain or increase profitability, firms will need to be more effective at project management. They will have to develop methods to streamline processes, monitor and control costs, minimize project risk, and manage cases more efficiently than ever before. Project management will become an essential element of law practice and lawyers will have to understand its underlying principles and techniques. Law firms should begin to incorporate project management training into their curriculum without delay.
Seyfarth Shaw has taken this step in a big way. The firm has adapted project management and process improvement methodologies used in manufacturing to create “Seyfarth Lean.” This system maps the delivery of legal services, identifies areas where efficiencies can be gained, and allows better cost predictions for clients. Three particularly impressive aspects of this approach are its overarching client focus, emphasis on attorney-client communication and collaboration, and search for continuous process improvement.
Seyfarth’s four-step process involves (1) identifying the client’s needs, objectives and definitions of success, (2) jointly selecting the best solution for the client’s problem, including process mapping that lays out all the steps involved in handling the client matter, (3) establishing, reviewing and implementing plans for execution, communication, oversight, reporting, mid-project changes, and tracking, and (4) measuring results. Seyfarth explains the benefits of its process this way: “Value and costs are aligned—clients pay only for the talent they need, the appropriate level of resource handles their work, and inefficiencies are removed from the process, which reduces the total number of hours required. The underlying costs of performing the work are understood and transparent.”
This system undoubtedly benefits clients, but it also gives the law firm a great deal of data that enables lawyers to evaluate, plan and implement legal projects more accurately and cost-effectively. The firm can make better process and staffing decisions, with greater predictability for its own internal planning and budgeting purposes. And when negotiating fixed or discounted fees, it has a better sense of what the costs and risks will be.
State Bar Mentoring Programs on the Rise
In the last few years, various judges and justices have expressed concern that most new lawyers are not well prepared to practice law when they enter practice. They have noted that new lawyers can become licensed to practice even though they have no real-world experience or knowledge of the practical, business and management aspects of law practice and client relations. Some judicial leaders have suggested that state bars promote mentoring as a way to ensure that new lawyers receive guidance from experienced ones in how to engage in law practice in accordance with the duties, responsibilities and expectations of members of the legal profession.
While there have been many bar-organized efforts to provide mentoring over the years, state bars and others interested in the primary and continuing education of lawyers have recently begun to act in earnest. In response to a request from the Conference of Chief Judges of the United States, the Center on Professionalism at the University of South Carolina School of Law has started to hold national conferences on mentoring. The next conference, “Best Practices in Building Sustainable Mentoring Programs,” will take place on April 10-12, 2010.
We can expect the interest in state bar-directed mentoring to continue growing.
One of the recommendations coming out of the critical issues summit mentioned
in “Trends to Watch” above calls for universal
mentoring for new members of the bar.
In 2005, Georgia was the first state to adopt mandatory mentoring for all newly admitted lawyers, and state bar-sponsored mentoring programs have been gaining momentum since then. At least two other states (Utah and South Carolina) have followed suit by mandating mentoring, several other states are promoting and supporting voluntary mentoring through programs that offer resources and matching services, and still more states are currently planning or studying bar-sponsored mentoring programs.
All state bar-led programs are intended to provide some degree of regulation, consistency, and/or coordination of mentoring for novice practitioners. They promote the development of competencies and conduct necessary for responsible and effective law practice, but most importantly, they emphasize inculcating in new lawyers a high sense of professionalism, ethics and civility. The underlying premise is that lawyers who receive this guidance during their first year in practice will develop understanding, skills, judgment and good habits that will last throughout their careers. (Some state bar programs are not limited to new lawyers, and are open to any lawyer who seeks mentoring assistance.)
The mentoring programs established by their state bars can benefit law firms with mentoring programs for their associates. Most state bar programs allow participation in law firm and other employer-sponsored mentoring programs to meet the state bar program requirements, provided the employer’s program and participants’ activities comply with those requirements. A number of states also allow new lawyers and mentors to receive MCLE credit for those mentoring activities. States acknowledge and encourage new lawyers to have “inside” mentors in their own firms and “outside” mentors from other sources. Some state programs also provide group mentoring as an alternative or supplement to one-on-one mentors.
Many of the state bar programs are making use of mentoring-related materials that I authored, such as The Lawyer’s Guide to Mentoring and the mentoring booklets, Being an Effective Mentor and Working with a Mentor. But many state bar programs publish on their websites excellent program materials that they have developed, including guidelines and handbooks, definitions and explanations, mentoring plan templates, and checklists of activities. These resources can be referenced and adapted by private firms and legal departments for use in their own mentoring programs. Any firm trying to create or improve its own program will find a wealth of resource materials and information on these websites.
Specific state mentoring programs include:
Moving Away from Early Specialization
Some UK firms recently announced that they are reversing the drive toward early specialization and returning to the practice of having associates rotate through several areas of law in their first few years of practice. These firms want well-rounded lawyers with broader experience and perspectives, and whose broader skill set gives them greater flexibility to respond to the firm’s client service needs.
Early specialization was mandated by many firms in the UK and the US as a response to high associate salaries and hourly fees. Some firms (e.g., O’Melveny & Myers, Latham & Watkins) resisted that pressure and still allow associates to spend time “sampling” different practice areas before making a choice of specialty. As someone who has long argued that too-early specialization limits the ability of junior lawyers to fully appreciate, understand and address the diverse aspects of legal issue and client needs, I welcome the move to more broad-based experience for junior associates and hope the practice spreads.
“The Sorcerer’s Apprenticeship: A Magical Solution to Training Associates?”
April 10-12, 2010: